Real estate company profile - Barwa

25 September 2008
Barwa Real Estate Company is publicly listed and trades on the Doha Securities Market. Its largest shareholder, with a 45 per cent stake, is master developer Qatari Diar.

Founded in December 2005, the company now has an asset base valued at QR24.2bn ($6.6bn) and 27 subsidiaries. Qatari Diar CEO Ghanim bin Saad al-Saad is its chairman and managing director.

“This year, Barwa posted total assets of QR24.21bn, a 53.2 per cent rise on the same period in 2007,” says Al-Saad.


Established: 2006

Value of projects: $11bn

Net profit (2007): $145.5m

Revenue (2007): $304.7m

Investment in associate companies amounts to QR1.75bn, property under development is valued at QR9.24bn and total shareholder equity stands at QR4.72bn. The firm is primarily a real estate developer.

“Barwa’s core business is real estate, and we committed from the early days of inception to provide our communities with innovative solutions for a wide spectrum of real estate activities,” says Al-Saad.

However, as a result of its diversification, the firm now lists its core businesses as real estate and project development, property and facilities management, construction material production, environmental activities, banking and finance, hotels and resorts, technology and utilities, communications and agriculture .

Subsidiary launches

Barwa is targeting this wide range of indus-tries via acquisition and investment. In early 2008, five subsidiaries were launched: Barwa Projects Management Company, Barwa Media Company, Barwa Knowledge Company, Barwa Technology Company and Barwa Lusail.

The project management company represents a foray into the consulting sector and will initially target Barwa and Qatari government projects.

The knowledge company will focus on training and education, whereas the media and technology firms are more focused on infrastructure. They will develop communication systems, IT development and support services throughout Barwa’s projects.

Barwa Lusail is a typical real estate company and is being formed in partnership with Barwa International for the purpose of holding and managing real estate investments in the Lusail development. It has a start-up capital of QR50m and is 30 per cent owned by Barwa and 70 per cent by Barwa International.

International ventures are another key priority for the firm. Barwa International operates as an independent company.

“This strategy eventually proved successful, introducing Barwa International to the forefront of the international real estate scene in 2007, with purchases of residential and commercial buildings and hotels in Europe and the Middle East and North Africa,” says Al-Saad.

“This brought the company’s assets to more than QR5.4bn, with offices in Cairo, Jeddah and London, and several new offices scheduled to open in 2008.”

Closer to home, it is the firm’s domestic projects that are the most advanced. Unlike many developers, it is planning both high and low-end accommodation developments. Projects such as Barwa al-Baraha are being built to house labourers servicing the construction boom.

The firm says this is part of its social responsibility agenda, but these projects can also be very lucrative as contractors continue to bemoan the rising costs of housing workers.

“Guest workers, mainly labourers, have become today an indelible part of Qatar’s demographics,” says Al-Saad. They come from all over the globe to support the development of our state. Barwa’s vision is to offer labourers living opportunities to make them feel at home.”

The firm claims that its development’s capacity for 53,000 workers is setting a new standard in labour accommodation, with cricket fields, tennis and basketball courts, a gym, a motel, restaurants, cinemas, a modern medical centre and a fire station.

“In addition to Barwa’s Al-Baraha project, the company is working on two residential compounds that offer almost 2,000 two and three-bedroom apartments for middle-income families,” says Al-Saad.

Energy hub

Other local projects such as the QR30bn Barwa al-Khor city development are also progressing well. The scheme aims to provide housing and entertainment facilities to the coastal city of Al-Khor, 45km north of Doha.

The city has traditionally been a hub for the energy sector, but the developer is planning 24,000 units that are set to house 60,000 people in two phases. Yasser Badran, manager of the project , tells MEED phase one is under way, with local contractor Boom carrying out earthmoving.

“The detailed design of the infrastructure will be completed in January and the contract tenders issued in March,” says Badran. “Phase-two infrastructure will be ready to tender in October or November 2009.”

On this scheme, Barwa, in a joint venture with Al-Imtaz Investment Company, based in Kuwait, is acting as master developer and plans to sell plots on to secondary companies who will build the residences.

“We are not doing the buildings,” says Badran. “These will be sold on to other developers but we have not started this process yet.”

Not surprisingly, given the business sectors in which Barwa operates, one of its most recent ventures is in setting up a Qatar-based mortgage company with a subsidiary of Dubai financial services company Amlak Finance.

“Our strong positioning in Qatar and the region leads us to align with the region’s pioneer providers of home finance, such as Amlak Finance, to create a conglomerate that will promote the development and advancement of the sector in Qatar,” says Al-Saad.

Like most companies in the region, Barwa cites human resources as the key barrier to growth for the firm. “At Barwa, integrating local and international expertise is the drive behind our human resources strategy,” says Al-Saad.

“We always join forces to facilitate communication between employees, participate in world-class conferences, register in workshops and interactive training courses, and appraise and reward employees.”

For now, Barwa is focused on launching its new developments, investing in new companies and setting up international ventures.

But consolidation should follow, and the firm must maintain the profit growth that it has begun to demonstrate in 2007 and 2008, when profits were up 38 per cent on half-year figures to QR277m in June this year.

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